USD/JPY- Bears flex muscles as equities suffer losses

The bid tone around Yen gathered pace, pushing the USD/JPY to a session low of 102.04 amid losses in the Asian equity markets.

China data caps losses

Pair managed to see a modest recovery from the low of 102.04 after China services PMI figure for June showed an improvement in the pace of expansion. The focus now is on the RBA rate decision and a possible action in the AUD/JPY cross.

Yen has been on the front foot since early Asia. Consequently, USD/JPY pair retreated from 102.59 to 102.04 before recovering slightly to 102.17 levels on strong China services PMI data. Contraction in the Japanese service sector as highlighted by Nikkei services PMI number received little attention from the markets.  

USD/JPY Technical Levels

The immediate hurdle is seen at 102.80 (50% of Brexit drop), above which prices could test 103.09 (10-DMA). A violation there could yield 103.75 (61.8% of Brexit drop). On the other hand, a breakdown of support at 101.85 (38.2% of Brexit drop) would expose 101.40 (June 27 low). Next major support is seen at 100.68 (23.6% Fibo).